In the machining industry, a tool holder is essential to productivity. Tool holders there are used not for mere storage of tools, but to secure tools in a CNC machining device, and thereby maintain accurate tooling standards. As a result, tool holders are not just used as a place to rest tools, but are essential for machining itself.

How tool holders functions in a manufacturing process depends on how well they can help to mold machines. All machining tools either constrain the workpiece or provide guiding movement for that part of the machine. The placement of the shank is one application. As a shank is rectangular and relatively long section of tool holders that gets clamped to a turret, placement has some variation relative to a tool presetter. As a result, they are often used in high velocity applications with various tool presetters.

Tool holders are still an important element of machining. 939,700 people were employed in machining in 2010 alone, meaning there is a large market for tool holders. As machining becomes ever more precise, manufacturers will develop more holders that can withstand higher velocity applications.